Highlights second quarter 2020
- Q2 Revenue declined by 4% to 15,253 tEUR (Q2 2019: 15,834 tEUR). Organic revenue decline was 24%. The development was impacted by the complete halt of all major sports events from mid-March through April and May before a gradual re-start late May and in June. Positive revenue growth returned in June with 20% growth, of which 7% was organic, even though some major markets, like the US and LATAM, were still affected by sports closedowns.
- Q2 EBITA before special items declined 7% to 6,305 tEUR (Q2 2019: 6,789 tEUR). The EBITA-margin before special items was 41%. The EBITA-margin remained in line with the financial target as the cost base was lowered significantly following the cost reduction program implemented from April 1, which reduced the cost base in Q2 2020 by approximately 3 mEUR compared to Q1 2020.
- Cash Flow from operations before special items was 10,363 tEUR (Q2 2019: 6,601 tEUR), an increase of 57%. The cash conversion was 154%. End of Q2, capital reserves stood at 65.1 mEUR consisting of cash of 19.5 mEUR and unused bank credit facilities of 45.7 mEUR.
- New Depositing Customers (NDCs) was approx. 71,000 in the quarter, representing a decline of 36%, due to the cancellations and postponements of major sports events.
- Better Collective completed the share buyback program per June 30, 2020. During the period March 19, 2020 to June 30, 2020 625,964 shares for an amount of EUR 4,811,557 (SEK 52,523,439) were purchased.
- The payment of the third and last instalment relating to the acquisition of Ribacka AB in cash and shares from the buyback program combined was completed. The payment reflected the maximum earn-out of 9 mEUR and consisted of 8.4 mEUR in cash and 0,6 mEUR in shares.
- Better Collective Tennessee divested the website pocketfives.com for an amount of 0.6 mEUR. The website was originally part of the acquisition of RiCal in May, 2019 and was considered non-strategic for Better Collective. The profit from the divestment is recorded as income under Special Items.
Significant events after the closure of the period
- July revenue was approximately 6.1 mEUR (total growth of 16% – organic growth 4%). NDC growth was 25% compared to July 2019. Based on betting activity in our major European revenue share accounts, European sports wagering showed the second-highest month ever.
- The remaining 63,231 new shares to be subscribed by the third seller of HLTV.org ApS as detailed in announcement no. 4 dated March 13, 2020 was settled in shares from the buyback program on July 3, 2020.
- Better Collective has signed a Letter of Intent (LOI) for the acquisition of an iGaming company for up to approximately 45 mEUR. The target company has a global presence and is specialised within lead generation towards online gambling. The target company has disclosed its current expectations for financial performance for 2020 with revenue of >40 mEUR and operational earnings (EBITDA) >8 mEUR. The acquisition is pending due diligence and final contract negotiations and will, if completed, be an important strategic move for Better Collective.
Jesper Søgaard, CEO of Better Collective, commented: “We have demonstrated the flexibility to withstand a period of low sports activity. I am very proud that we could maintain our financial earning target (EBITA > 40%) both for Q2 isolated and the full half year.”
About Better Collective
Better Collective is a global sports betting media group that develops digital platforms for betting tips, bookmaker information and iGaming communities. Better Collective’s vision is to empower iGamers through innovative products and technologies and by creating transparency in the online betting market. Its portfolio of platforms and products include bettingexpert.com, the trusted home of tips from expert tipsters and in depth betting theory, HLTV.org, the world’s leading esports media and community focusing on competitive Counter Strike: Global Offensive (CS:GO), and vegasinsider.com, a leading source for sports betting information in the US. Better Collective is headquartered in Copenhagen, Denmark, and listed on Nasdaq Stockholm (BETCO).
